Evening star. [volume] (Washington, D.C.) 1854-1972, 1887-12-16


Baltimore Special to the New York Tribune
senator German and other state and city direct
ors OF the Baltimore and Ohio Railroad caused q
sensation at the special meeting OF the board last
Saturday, at which the terms Of the DrexelMor-
gan syndicate were presented and Samuel spencer
elected president. The episode has leaked out, and
from gentleman who was present is learned the
reason why the board held such q protracted ses-
sion on that occasion. At q previous meeting OF
the board the consolidated mortgage negotiated
with the syndicate was presented, but It was
not pressed. Senator German, OF the state
directors and Mckinney White, OF the city
directors insisted that statement should be made
showing the liabilities and the necessity for the
unusual contract that had been made with the
syndicate. This was promised. After that the
annual stockholders meeting was held and the
syn 9 VINO had the privilege TO appoint three
OF -FOUR directors, named their selections. When
the new board was completed an extra meeting
was called-on last Saturday-aDd the mortgage
MED by financial statement which city and State
directors Insisted showed absolutely nothing. II
Was, MAS however, proposed outside OF their ooec
out the demanded explanation.
speech that was made at this point on the
side OF the directors caused scene such as has
Tory meeting FOR a quarter OF q century. The
speaker gave notice In the most emphatic way
proved at that sitting, and that he believed the
board OF public works OF the State would be just-
ueu Ia enJOnlng action on the part OF the COM
pany unless the board OF directors were furnished
with all the facts relating to the transaction.
The president finally produced a printed state
ment, which mas been published. The city and
State directors asked for time TO consider this
statement, and since the recess are understood TO
have decided that there was nothing to be done
except to carry out the contract, as 1t appeared
by the statement that after crediting $1,000 900
received from the sale OF the express, there re-
mains nearly 80 600 900 OF floating deDt carried by
the syndicate. The terms OF the syndicate have
been characterized as OnerOus and harsh. The
syndicate takes 900 900 OF per cent bonds rum
ming Tor one hundred years, at Is, and s. 600 900
OF the per cent nxed-dividend preferred STOCK at
b. This Will insure the syndicate $1,000, 900 for
their share, provided they sell as low as par the
securities they take. II the one hundred-year
bonds. amply secured as the syndicate no doubt
the other mortgages OF the company, they Will
realize big premium. A secured bond that runs
Tor century would be thought by most nnanciers
10 be worth 40, which would be equivalent to
81 zoo, 600 more for the syndicate. That would
CIV the syndicate S. Goo 600 for their profit on the
$4,000, 600 loan. The issued preferred stock of
the company has been for days past quoted at ITO
bid and III asked. and that Is low for per cent
security.
IThe state directors tried but failed, to secure
reduction OF the time for which the bonds will rum
They urged that the company ought TO have had
the right TO redeem them at any time after thirty
years at pleasure, but several Of the stakeholder
directors thought otherwise. Financiers consider
that the large earning Capacities OF The company
VIII insure tie earning OF its fixed charges and
return TO legitimate dividends on the common
stock.